Topic Hub: SHAPE

Consider the following. A scientist with some promising research has a chat with their technology transfer office. The TTO will first look at the IP and if the research looks promising commercially, will examine the patentability. At that point they may look to either licence to an existing company or if one doesn’t exist or the researcher is so willing, a spinout venture could be formed. If the latter, the key will typically be getting VC (venture capital) investment (or angel investment and grants). VCs with a science background and a science focus will take a look at the IP, the market it sits in and give or take the team and then decide whether or not to invest. They bring expertise, a ready network and likely as not can, with the TTOs, find experienced management to join or guide the nascent venture.

STEM commercialisation pathway that most TTOS are setup to do is at one end of the spectrum with SHAPE ventures predominantly occupying the other end of the spectrum

This is by no means all STEM ventures, but it is a stylised view of the TTO process to date and that’s been made possible because a lot of STEM commercialisation has known pathways – IP is understood, VCs with expertise in different sectors, and known to universities can make reasonable judgements on the IP and its commercialisability.

Now consider the SHAPE venture, one can with confidence reject the above almost entirely. Firstly, the IP first approach is often nonsensical. IP is soft – at best it’s code and databases but more often than not its methodologies, frameworks, toolkits, maybe an algorithm – all things for which the best defence is a secret and early market entry.

Secondly, the IP is intrinsically linked with the researcher – a methodology for interpreting workplace culture is not a plug and play tool (at least not in the beginning) – one can’t just parachute in an experienced hire to take the lead.

Thirdly, there are rarely structured markets to go into – the original application it was used for may not be the one it can make any money in. Even where it targets a sector, it’s usually one run by the government – education, social policy, environment – not the kind of market that has VC’s weak at the knees if they even know what it is.

If this sounds pessimistic it’s not, it’s simply to illustrate that the STEM commercialisation pathway that most TTOs are setup to do is at one end of the spectrum, with SHAPE ventures predominantly occupying the other end of the spectrum. That in turn requires a different approach, one that embraces the fact the pathway is less linear and there are more unknowns.

Fortunately models for this already exist on most campuses – Accelerators. Tech’s solution for ventures in search of training and product market fit (typically defined as finding a large enough market of customers passionate enough to pay for your product) addresses the same challenges that SHAPE ventures experience. What does that tell us about how TTOs should commercialise SHAPE?

• Flip the IP first approach – IP is not the mainstay of most accelerators and nor should it be for SHAPE ventures. It’s a logical first step for a would-be STEM venture (especially if the academic is keen to publish) but makes little sense for SHAPE research – instead focus on first-to-market and build a brand around the research as the defensive moat. TTOs and researchers often obsess around IP with lengthy processes – that might make sense for STEM but for SHAPE it’s a dangerous distraction for both from the core challenge, finding a customer.
• The researcher has to be the entrepreneur – IP is rarely detachable in SHAPE, software is the exception not the norm and there is lots of assumed know-how the researcher may not realise they know. That means at the start – they are likely the only person who can start the venture. That means they need to become the entrepreneur (especially as investors are less likely at the start of SHAPE commercialisation). An obvious challenge here is why a busy, often tenured researcher would give up time and security to be an entrepreneur – they may not, and the best option may be to look for a PhD or ECR (early career researcher) who is more entrepreneurially minded.
• Cohorts to effect mindset – Turning a researcher (especially a SHAPE one) where commercialisation is a less socialised idea, into an entrepreneur is difficult but the advantage of accelerator models is they provide a natural peer group to help the process.
• Market validation – There is rarely a linear path to commercialisation, which means market validation needs to be done early and more extensively. This is not a drug with a handful of pharma companies to speak to – likely as not the SHAPE research could be applied in many contexts and worse many might be government-controlled areas (e.g., social policy) with little cash to spare – that means much more extensive market validation to get the venture off the ground. This has a benefit though; the researcher will not only learn who is really interested first-hand they’ll learn to calibrate how they communicate away from academic language to one non research audiences can engage with.
• Investors are a nice to have, focus on the first customer – Many of the SHAPE ventures won’t have an obvious investor, traditional university investors are geared to STEM and even areas like EdTech are nascent. Instead, SHAPE ventures will need to focus on getting their first customer instead and bootstrap until they can attract investment later (and a first customer will make the investor – unfamiliar with SHAPE ventures much more comfortable).

The traditional technology transfer processes and networks were setup in a different time, for predominantly STEM research. In order to unlock the full potential of SHAPE ventures, TTOs will need to rethink their processes and move, if not to establish formal accelerators then to adopt the processes of accelerators to enable SHAPE researchers to realise their venture’s potential.

ARC accelerator was created to catalyse this process in the UK. Funded as part of the ASPECT network (itself funded by Research England) it was founded by myself (Founder and Director) with Tony Walker (University of Manchester) and Sam Gallagher (then Oxentia). It takes up to 18 teams each year, and TTOs work to share networks and support each other’s ventures through the programme.

Why an accelerator? Even universities with the largest pipelines for SHAPE commercialisation would struggle to get enough at any one time to get a cohort, depriving the researcher of the many advantages of a peer group (support, ideas… and a bit of friendly competition!). Indeed, the number one bit of feedback from researchers on ARC was how delighted they were that something existed specifically for SHAPE researchers. On two counts, (1) they felt validated and (2) enabling them to believe they could be entrepreneurs was much easier when they had a peer group of researchers from their own fields undergoing the same change.

This first change laid the foundation for the second which was the prevalence of non-linear commercialisation pathways. One venture for example began with a process for measuring cultural differences between countries (e.g., openness) then pivoted to helping companies with different cultures manage mergers and acquisitions. Another began as a database of policies and votes across local government in the US and moved towards training and education services to policymakers in local government in the US (to help share best practice).

The premise of ARC is that these are new, that TTOs are learning on the job because this isn’t the same as STEM and that by working with cohorts everyone (TTOs and researchers) learns faster. Thus, the accelerator is not just for the ventures but aims to accelerate SHAPE commercialisation across the UK too.